European SMEs gain onchain loan options but still require collateral and legal enforcement, with active loan books ranging from $16M to $2.22B.
Tokenization of private credit is opening new funding channels for European small and medium-sized enterprises, yet borrower assessment and collateral requirements remain unchanged. Active loan books across leading protocols span from $16M to $2.22B, reflecting varied yields, sector exposure, and default rates.
Despite the shift to blockchain-based lending, underwriting standards and legal recovery processes persist as critical factors. Protocols differ significantly in fees and risk profiles, with no uniform approach to credit evaluation or enforcement.
A case study of 8lends and Maclear AG highlights tokenization’s role in improving access but underscores persistent challenges in underwriting and regulatory compliance.